Why Using ‘Healthy’ and ‘Natural’ on Your Product Label May Not Help Your Bottom Line

As consumer desire for clean, healthy, and natural foods continues to grow, food companies are increasingly interested in including these types of claims on product labels. The theory is that the more “natural” or “healthy” a food product appears, the more likely consumers are to purchase it. The use of any word or term on a food product label, however, could create significant regulatory or class action risk for food companies.

For this reason, food companies should carefully consider any marketing term that is included on a product label or in product advertising. Although FDA has direct regulatory authority over food labels per se, the agency has interpreted this authority to include food advertising (i.e., ancillary statements made in flyers, in commercial advertisements, or on the internet). In turn, the Federal Trade Commission (FTC) also has direct regulatory authority over food advertising claims and can take its own regulatory enforcement actions against food companies that make claims found to be deceptive or misleading. FTC will find an advertisement deceptive and unlawful if it contains a material representation or omission of fact that is likely to mislead consumers acting reasonably under the circumstances.

The risks associated with using such claims can be significant. This is especially true when both regulators and class action lawyers are constantly scanning store shelves for products using these terms. In this article, we will look closely at the definitions of both “healthy” and “natural” and provide an update on the overall regulatory enforcement approach being adopted, as well as some recent examples of class action lawsuits.

“Healthy” Labels

When using the term “healthy” on a product label or in advertising, food companies should conduct a careful review of FDA’s definition and previous treatment of the term to avoid regulatory action and potential lawsuits. FDA has previously taken formal regulatory action, including issuing formal (and public) warning letters, for the improper use of the term “healthy” on product labels and in advertising. Even without regulatory action, companies may face lawsuits when “healthy” is improperly used on foods, potentially leading to huge defense expenses and possibly a costly settlement.

As defined by FDA, the term “healthy” requires that the food meet certain nutritional requirements; however, after issuing a Warning Letter to KIND for the use of “healthy” on products that the agency argued did not meet these requirements, and later reversing its decision, FDA has started to refine its policy and approach to enforcing the labeling requirements.

Generally, all agree that a product using the term “healthy” must be low fat, low in saturated fat, and low cholesterol. Additionally, for certain product categories, the product must also be a good source of one or more vitamins or minerals. Additional requirements can be found in the regulations. All companies should thus carefully review the requirements of 21 C.F.R. 101.65(d)(2) before making a “healthy” claim on a product.

In addition to the requirements provided in 21 C.F.R. 101.65(d)(2), FDA has issued guidance stating that products that are not low in total fat but have a fat profile of predominately mono- and polyunsaturated fats or are a good source of potassium or vitamin D can use the term “healthy” in labeling and advertising. Although guidance documents are not law, FDA has stated that the agency will use enforcement discretion to avoid taking regulatory action against products labeled “healthy” in accordance with the September 2016 guidance document. The agency also indicated that updates to the Dietary Guidelines supported the additional products that can be labeled “healthy,” and that the latest nutrition science would be considered when finalizing an updated definition for the term.